The Big Picture: FY2023
FY2023 marked a milestone as short-term rental tax revenue hit a record high during summer 2023. The town's operating budget of $116 million funded all municipal services, with tourism continuing to drive significant revenue growth.
| Operating Budget | $116 million |
| Capital Projects | $17+ million |
| Town Meeting Vote | 661 - 110 |
Where the Money Came From
Property taxes continued to dominate Nantucket's revenue in FY2023. The room occupancy tax from hotels and short-term rentals exceeded $13.2 million - more than 10% of total revenue.
Revenue Breakdown (FY2023)
| Source | Amount | Share |
|---|---|---|
| Property Tax | ~$94 million | 81% |
| Rooms & Meals Tax | $13.2+ million | 11% |
| State Aid | ~$3.5 million | 3% |
| Motor Vehicle Excise | ~$2.3 million | 2% |
| Other Local Receipts | ~$3.5 million | 3% |
Record-Breaking STR Tax Revenue
Summer 2023 set a record for short-term rental tax collections. STRs generated $4.8 million in taxes during June-August 2023 alone - a 10% increase over 2022 and the highest quarterly amount since the tax began in 2019.
Where the Money Went
The largest expense categories remained education and town employee compensation, followed by benefits and day-to-day operations.
Major Expense Categories (FY2023)
| Category | Amount | Notes |
|---|---|---|
| School Salaries | ~$28 million | Teachers and school staff |
| Town Salaries | ~$20 million | Municipal employees |
| Medical & Insurance | ~$18 million | Employee benefits |
| Operations | ~$9 million | Day-to-day costs |
| Retirement | ~$5.5 million | Pension obligations |
Capital Projects & Tax Overrides: FY2023
In addition to the operating budget, voters approved over $17 million in capital projects at the 2023 Town Meeting, plus significant tax overrides:
- Affordable Housing Trust: $6.5 million (override approved 607-226)
- Wauwinet Bicycle Path: $4.6 million (override approved 757-90)
- Capital Expenditures: $17+ million (approved 666-103)
The affordable housing override added approximately $211 to the average homeowner's annual property tax bill.
Property Tax Context: FY2023
- Residential Tax Rate: $3.21 per $1,000 assessed value
- Commercial Tax Rate: $5.46 per $1,000 assessed value
- Open Land Tax Rate: $3.05 per $1,000 assessed value
For a residential property assessed at $1 million, the annual property tax bill was approximately $3,210.
Comparison: FY2023 to FY2024
| Metric | FY2023 | FY2024 | Change |
|---|---|---|---|
| Operating Budget | $116M | $131M | +13% |
| Room Tax Revenue | $13.2M | $13.6M | +3% |
| Residential Tax Rate | $3.21 | $3.13 | -2.5% |
| Avg Tax Bill Change | - | - | +18% |
Note: While the tax rate decreased from $3.21 to $3.13, average tax bills increased 18% due to rising property valuations.
Data Notes
Some FY2023 expense figures are estimates based on historical trends and available documentation. Property tax and room occupancy tax figures are from official town sources and news coverage. For detailed line-item budgets, consult the official town budget documents.
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